January Wrap-up and What’s to come in February
Our team will once again be recapping major market activity and economic news each month, as well as important things to look for and important dates in the following month.
January 2026 is a wrap. Economic news was largely positive, and market performance reflected that strength, with most sectors moving together. Some activity, like a Fed Chair nomination and a partial government shutdown, injected some uncertainty in the latter half of the month.
More updates on the markets, economic data, and global news below.
Market Update: January
- The S&P 500 finished January up roughly 1.4%, briefly climbing above 7,000 for the first time, reflecting early-year optimism.
- The Dow Jones extended its rally to nine consecutive months, gaining about 1.7%. This is its best streak since 2018.
- The Nasdaq Composite rose modestly, about 0.97%.
- Sector performance varied:
- Energy led gains in January, returning to double-digit performance.
- Precious metals, especially gold and silver, hit multi-year highs before pulling back late in the month.
- Technology stocks were strong early, but faced volatility mid-month, with some analysts pointing to regulatory proposals and sector rotation as headwinds.
Economic Data: Rates, Inflation, Labor Market
The Federal Reserve held interest rates steady at its January policy meeting, signaling that policymakers are watching incoming data before committing to further cuts.
- The partial government shutdown will delay data releases, including the January jobs report.
- The Fed maintained its target range 3.50–3.75% following last year’s cuts, balancing inflation pressures with a resilient labor market.
- Inflation data remained above the Fed’s 2% target, with CPI around 2.7 % year-over-year.
Corporate Earnings and Sector Highlights:
Earnings continued to be a focal point for markets as 2025’s strong results carried into early 2026:
- Earnings results for Q4 and some early Q1 estimates remained generally constructive, supporting equity performance.
- Precious metals and commodities showed strong performance, often signaling hedging demand amid macro uncertainty.
Geopolitical and Notable Global Developments:
- Global markets were mixed, with European equities hitting record highs and Asian markets experiencing volatility amid economic recoveries.
- Ongoing geopolitical tensions in Eastern Europe and the Middle East continued to influence energy and commodity markets.
- Central banks across major economies remained cautious, with the European Central Bank and Bank of England signaling a data-dependent approach as global policymakers seek to balance inflation control with economic growth.
Here’s What to Look for in February:
Key events and data releases to watch in February include:
- February 1-6: Q4 earnings calls for many companies
- February 16: Markets closed for President’s Day
- February 18: Federal Reserve meeting minutes are scheduled for release
As markets move into February, investors are navigating a landscape defined by opportunity, uncertainty, and ongoing change. A thoughtful, diversified approach remains key as the month and year progress.
Reach out to us anytime to discuss recent market developments and ensure your investment strategy remains aligned with your long-term objectives.
Have a great month!
Sources:
https://www.morningstar.com/markets
Disclosures:
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.
All performance referenced is historical and is no guarantee of future results.
All investing involves risk including loss of principal.
No strategy assures success or protects against loss.
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio.
Diversification does not protect against market risk.
The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
The prices of small cap stocks are generally more volatile than large cap stocks.
The Russell 2000 Index is an unmanaged index generally representative of the 2,000 smallest companies in the Russell 3000 index, which represents approximately 10% of the total market capitalization of the Russell 3000 Index.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.
The Bloomberg U.S. Aggregate Bond Index is an index of the U.S. investment-grade fixed-rate bond market, including both government and corporate bonds.
The fast price swings of commodities will result in significant volatility in an investor’s holdings.
Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.
Investment advice offered through Shepherd Financial Partners, LLC, a registered investment advisor. Registration as an investment advisor does not imply any level of skill or training.
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